Digital ad market may touch Rs 12,046 crore by year-end

Mumbai: The digital advertising spends in the country is estimated to grow at a compounded annual growth rate of 30 per cent to reach Rs 12,046 crore by end of this calendar year, says an Internet and Mobile Association of India (IAMAI) and Kantar IMRB report.

The digital advertising spend which was estimated to be around Rs 9,266 crore at the end of 2017, would be about 16 per cent of the total ad-spends in the country that is pegged at Rs 59,000 crore.

In terms of total spend, banking, financial services and insurance (BFSI) led the digital ad-spend in 2017 at around Rs 2,022 crore, followed by e-commerce, according to the report Digital Advertising in India 2017.

"BFSI brands incurred the highest share of advertising on digital media with 46 per cent of their overall advertising spends in digital, followed by e-commerce, telecom and travel," it said noting that 68 per cent of the overall digital ad spends comes from these four verticals.

The report also said that 27 per cent of total digital ad spends in 2017, around Rs 2,502 crore was made on search, followed by spends on video and mobile that is around 19 per cent with ad spend being Rs 1,779 crore and Rs 1,761 crore, respectively.

Ad spends on social media stood at 18 per cent at around Rs 1,668 crore, with the least being spent on display ads that has 16 per cent share with total ad spend being Rs 1,483 crore.

It observed that spending on mobile advertising (SMS/in-app ads) reported a year-on-year growth of 34 per cent from Rs 1,314 crore in 2016 to around Rs 1,761 crore in 2017.

"This is because advertising on mobile is considered to be innovative and conveys the message clearly. Also in-app advertising is currently being explored and used across various industry sectors since it is believed to fetch better monetisation," it said.

Driven by falling data prices and availability of low cost handsets, mobile advertising is expected to increase, it added.